Infosys defies projections: IT major

Bengaluru: Infosys, India’s second largest IT exporter, on Friday reported 38.3 percent growth in consolidated net profit to Rs 5,129 crore for the October-December quarter of 2017-18 year. It had posted a net profit of Rs 3,708 crore in the year-ago period, as per IFRS accounting norms, Infosys said in a BSE filing. Revenue of the Bengaluru-based firm grew 3 percent to Rs 17,794 crore in the quarter under review, as against Rs 17,273 crore in the December 2016 quarter.

The company has maintained its FY2017-18 sales growth outlook at 5.5-6.5 percent in constant currency terms. Infosys explained that during the December 2017 quarter, it had signed an Advance Pricing Agreement with the US administration that had led to reversal of income tax expense provision of Rs 1,432 crore. “Consequently, profit for the period has increased and therefore has led to an increase in Basic earnings per equity share by Rs 6.29 for quarter ended December 31, 2017,” it added.

An Infosys signboard. Reuters.

This is the first quarterly results since Salil Parekh took charge as the new CEO and MD at Infosys on 2 January. Parekh’s appointment came after the abrupt resignation of Vishal Sikka, who had quit in August following public spat with co-founders led by N R Narayana Murthy. The founders had alleged corporate governance lapses and questioned the $200 million Panaya acquisition under previous management and also flagged the high severance pay to former employees. Under Parekh, Infosys is now attempting to bring the focus back on growth and business.

“…Our Q3 performance is strong… We are progressing towards stability and are well positioned to serve our clients in the new areas of demand,” Parekh said. On a sequential basis, the company’s net profit rose 37.6 percent, while revenues were up 1.3 percent in rupee terms. In US dollar terms, Infosys’ net profit grew to $796 million in the said quarter, while revenues were at $2.7 billion from the year-ago period. Its total headcount stood at 2.01 lakh at the end of December quarter. Infosys said Rajesh K Murthy, President, has resigned from the company citing personal reasons and will be with the company till January 31, 2018.